No Severance for Employees Who Refused Alternate Work

09/13/2010|Canadian Labour Reporter|Last Updated: 02/04/2011

Following the sale of the transmission rebuilding section of an automotive products company, six skilled, long-service workers were invited to bump into the remaining parts business. Instead, the workers grieved, seeking termination and severance pay.

The union took the position that the workers were entitled to severance and termination pay because they had been terminated when the section of the business that employed them was sold.

The workers were not obligated to “de-skill” and bump down into lower rated positions that would result in a significant loss of pay, the union said. In any case, any contemplated bumping down would amount to a constructive dismissal given the lower wages and fundamental changes to working conditions. This was not a layoff but a termination following the sale of the business, the union said. The workers were now out of a job and entitled under the collective agreement and the Employment Standards Act to termination and severance pay.